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Market Overview
The US CPI rekindled the expectation of interest rate cuts, US bonds and gold jumped, and the three major US stock indexes hit new highs.
The S&P and Nasdaq rose more than 1%. The chip stock index rose for four consecutive days, Nvidia closed up 3.6%, AI "demon stocks" Supermicro Computer rose nearly 16%, and Dell rose 11%. Tesla closed down 2%. AMC and many other retail stocks fell by more than 30% intraday, and the game station once dived by 35%. Warren Buffett's mysterious position in Chubb rose more than 6% after hours. The pan-European stock index hit a record high for seven consecutive days, and German, French and British stocks reached new highs.
After the release of the US CPI, the 10-year US Treasury yield plunged more than 10 basis points intraday, and the US dollar index both hit a new five-week low since the release of the March CPI. The yen rose more than 1% during the session.
Crude oil reversed in a V-shape, falling more than 1% intraday before turning higher, out of a nine-week low. Gold rose more than 1% to a new high in more than three weeks. Silver hit an 11-year high, up more than 4% intraday. London copper rebounded 1% to a two-year high, and New Zealand copper continued to approach the record high of nearly two years ago, rising nearly 5% at one point. Bitcoin rose $5,000 intraday.
In the Chinese market, during the U.S. stock market, the Chinese concept stock index rebounded thrillingly, with Alibaba rising nearly 2%, while NIO closed down 8%, and Zeekr and Xpeng Motors fell 3.5%; The offshore yuan rose more than 300 points to break through 7.21, hitting a new high in more than a week. A-shares continued to pull back, power stocks collectively dived, real estate bucked the trend and strengthened, and Vanke bonds rose intraday.
News
Wu Qing: Resolutely clear the "zombie enterprises" and black sheep from the market. China Securities Regulatory Commission: In 2024, it will strictly crack down on illegal acts in the securities and futures market that seriously endanger the smooth operation of the market and infringe on the legitimate rights and interests of investors; Strengthen the supervision of high-frequency trading, which will be officially implemented on October 8; The "key minority" can promise to extend the lock-up period in the event of a significant decline in performance after listing.
Lin'an District, Hangzhou: Acquired a batch of commercial housing in the district for use as public rental housing.
The core CPI in the United States fell to 3.6% year-on-year in April, the lowest in three years, and the month-on-month growth rate fell for the first time in six months, and the market raised its expectations for the pace of interest rate cuts by the Fed this year. "New Fed News Agency": It is still possible that there will still be no rate cut before September.
U.S. retail sales in April were flat month-on-month, sharply below expectations of 0.4%, and the previous value was revised downward.
The two major U.S. "creditors" continued to diverge, with Japan's holdings of U.S. bonds rising for six consecutive months, and China's holdings hitting a new low since 2009.
Morgan Stanley: Hon Hai's unique CMMS model is expected to increase the profit of AI server business, and the market underestimates Foxconn; Dell's AI server momentum is stronger than any other OEM, with a massive price target of nearly 19%.
Berkshire reduced its holdings in Apple in the first quarter, which is still the number one heavy position, and the mysterious position has finally been exposed, which is Chubb, a Zurich-based insurance company, with a shareholding value of $6.7 billion.
The market closes
U.S. stocks: The Dow rose 0.88%, the S&P 500 rose 1.17%, and the Nasdaq rose 1.4%.
European stocks: The European STOXX 600 index closed up 0.59%. Germany's DAX 30 index closed up 0.82%. France's CAC 40 index closed up 0.17%. Britain's FTSE 100 index closed up 0.21%.
A-shares: The Shanghai Composite Index fell 0.82%, the Shenzhen Component Index fell 0.88%, and the ChiNext Index fell 0.9%.
Bond market: The yield on the benchmark 10-year U.S. Treasury note fell 8.19 basis points to 4.3575%. The yield on the two-year Treasury note fell 8.46 basis points to 4.7343%.
Commodities: WTI crude oil futures for June delivery closed up $0.61, or 0.79%, at $78.63 a barrel. Brent crude futures for July delivery closed up $0.37, or 0.45%, at $82.75 a barrel. COMEX gold futures rose 1.35% to $2,391.80 an ounce. COMEX silver futures rose 4.25% to $29.922. London nickel closed up about 2.2%, and London copper and London aluminum rose at least more than 1%.
Highlights
Global blockbuster
Wu Qing: Resolutely clear the "zombie enterprises" and black sheep from the market. China Securities Regulatory Commission: In 2024, it will strictly crack down on illegal acts in the securities and futures market that seriously endanger the smooth operation of the market and infringe on the legitimate rights and interests of investors.
- Wu Qing said that it is necessary to further promote the improvement of the quality of listed companies. The purpose is to resolutely keep counterfeiters out, implement the requirements of openness and transparency in the whole process of corporate information disclosure, integrate the concept of respecting investors and rewarding investors into various mechanisms of corporate governance, and resolutely remove "zombie enterprises" and black sheep from the market.
- The China Securities Regulatory Commission said that in 2024, it will strictly investigate major cases, focusing on cracking down on illegal activities such as fraudulent issuance, financial fraud, occupation of guarantees, and illegal shareholding reduction.
China Securities Regulatory Commission: Strengthen the supervision of high-frequency trading, which will be officially implemented on October 8; Quantitative private placement: low-frequency strategies may become a trend. The analysis points out that the fundamental-based mid-frequency strategy will become a quantitative trend, and in order to cope with this change, foreign quantification and domestic quantification are competing for low-frequency strategy talents.
SFC: The "key minority" can promise to extend the lock-up period in the event of a significant decline in performance after listing. The CSRC pointed out that it is clear that the "key minority" can make a commitment to extend the share lock-up period in the event of a sharp decline in performance after listing, strengthen the awareness of the "key minority" to share risks with investors, and improve the information disclosure rules for the post-listing dividend policy.
Lin'an District, Hangzhou: Acquired a batch of commercial housing in the district for use as public rental housing.
U.S. inflation cooled in April, with core CPI falling to 3.6% year-on-year, the slowest increase in three years, and the month-on-month growth rate falling for the first time in six months, as the swap market raised expectations for the Fed's rate cuts within the year.
- Traders believe that by the September Fed meeting, the probability of a 25 basis point rate cut is more than 80%.
- The New Fed News Agency noted that two more CPI reports are needed to boost Fed confidence, following the April report. The Fed may still not cut rates before September. The significance of the April CPI data is that it retains the possibility of a rate cut later this year and calms some fears that the Fed may need to open the door to further rate hikes.
- Wall Street analysts said that April's inflation data, if not enough to allow the Fed to cut interest rates in July, was enough to start cutting rates in September. But there are also analysts who have a conservative view.
U.S. retail sales were flat in April from the previous month, with growth sharply lower than expectations of 0.4%, and the previous value was revised to 0.6% from 0.7%.
The two major U.S. "creditors" continued to diverge, with Japan's holdings of U.S. bonds rising for six consecutive months, and China's holdings hitting a new low since 2009. Japan's holdings of U.S. bonds increased by $19.9 billion to nearly $1.19 trillion in March, continuing to hit a new high since August 2002, while China's holdings fell by $7.6 billion month-on-month to $767.4 billion, falling for three consecutive months. However, Japan's yen has repeatedly weakened after ending negative interest rates in March, and it may intervene in the foreign exchange market and sell US bonds at the end of April.
Morgan Stanley: Hon Hai's unique CMMS model is expected to increase the profit of AI server business, and the market underestimates Foxconn; Dell's AI servers are gaining momentum stronger than any other OEM, with a massive price target of nearly 19% and an 11% jump in stock price. Da Mo expects Hon Hai's AI server revenue and profit to increase by 30% and 126% year-on-year in 2025, respectively, in addition, the iPhone assembly business will continue to perform better than expected.
Berkshire reduced its holdings of Apple in the first quarter, which is still the number one heavy position, and the mysterious position has finally been exposed. Berkshire has bought nearly 26 million shares of Zurich-based insurer Chubb with a stake value of $6.7 billion, making it its ninth-largest holding. Berkshire's overweight in financials has outpaced other sectors, with the market value of disclosed investments falling 4.5%.
Domestic macro
Qiushi magazine published an important article by General Secretary Xi Jinping entitled "Comprehensively Deepening Reform and Opening-up and Injecting Strong Impetus into Chinese-style Modernization". The article points out that it is necessary to plan major measures to further deepen reform in an all-round way, and continue to inject strong impetus into promoting high-quality development and promoting Chinese-style modernization.
China's central bank "does not cut interest rates", and parity continues to increase MLF by 125 billion yuan. China's central bank conducted a 125 billion yuan MLF operation on Wednesday, and the winning bid rate was 2.50%, the same as before, and 125 billion yuan of MLF expired on the same day.
- Why haven't we seen an MLF rate cut? According to the analysis of Everbright Securities, the decline in financial data does not mean that the strength of financial support entities has weakened, and there is no need to immediately use a powerful policy tool such as MLF interest rate cuts. The macro team of Galaxy Securities said that considering the landing of ultra-long-term special treasury bonds, the RRR and interest rate cuts may be approaching, of which the RRR cut may come soon, and the interest rate cut may be in the second quarter.
Domestic companies
Yu Chengdong appeared at Huawei's press conference for the first time after taking office, and the number of HarmonyOS ecological devices currently exceeds 800 million. TechInsights predicts that Huawei will ship more than 50 million smartphones in China in 2024, increasing its market share from 12% in 2023 to 19% in 2024.
Byte released a large model of bean bags, which is 99.3% cheaper than the industry, and the price war is open. According to the price announced by Volcano Engine, one yuan can buy 1.25 million Tokens of the main model of bean bags, which is equivalent to three copies of "Romance of the Three Kingdoms".
Overseas macro
Eurozone GDP grew 0.4% year-on-year in the first quarter, and the European Union said that a soft landing in the eurozone is on track, with inflation falling faster than previously expected, forecasting GDP growth of 0.8% in 2024.
IEA Monthly Report: For the second consecutive month, the global crude oil demand growth forecast for 2024 has been lowered, and the demand growth rate in 2025 is expected to be higher than this year.
Overseas companies
GPT-4o killed the start-up and tested it on the whole network, and Musk Karpathy and other bigwigs expressed their disbelief: OpenAI is nothing more than that. As soon as GPT-4o was launched, netizens across the Internet exclaimed after the actual test: This inference speed is an upgrade of the crushing version! However, Musk, Karpathy, Meta researchers and other bigwigs said that OpenAI is nothing more than releasing a model that combines text-audio-video modalities in the same neural network and processes them at the same time.
OpenAI's rival Anthropic is going to make a big push on the product line, hiring Instagram co-founder Mike Krieger. Anthropic faces a critical moment when it urgently needs to move from technology R&D to consumer-facing products.
Open AI Gong Dou Finale: Chief Scientist Ilya resigns along with key allies.
Pioneer's "next CEO" chose a former BlackRock executive, and the currency circle is high. Ramji has a great passion for investing in crypto assets and has directly promoted the listing of its Bitcoin spot ETF at BlackRock. There is speculation that his appointment may mean that Vanguard has reversed its attitude towards crypto assets.
"Miracle medicine for weight loss" is soaring, Da Mo: To Novo Nordisk, don't hesitate! Morgan Stanley expects Novo Nordisk's revenue to increase by more than 50% and operating profit by more than 80% in 2024, supported by strong sales growth in semaglutide.
Industry/Concept
1. Monoammonium phosphate| According to Baichuan Yingfu data, on May 15, the domestic monoammonium phosphate market as a whole showed an upward trend, of which the price of industrial monoammonium phosphate was 5935 yuan/ton, up 6.04% compared with the day before yesterday and 8% compared with the beginning of the month. At present, the supply of monoammonium phosphate is tight, the market demand is increasing, the trading atmosphere is good, and the market is running at a high price.
Comments: At present, industrial-grade ammonium phosphate has been mostly stopped and signed, due to the active downstream goods, resulting in a shortage of supply on the supply side, and mainstream enterprises have issued pre-receipts. Due to the good demand, the industrial ammonium market is in short supply, and the industrial-grade ammonium phosphate market is rising. It is expected that the price trend of the industrial ammonium market will rise in the short term, and it is necessary to continue to pay attention to the downstream demand, cost trends and the start of enterprises.
2. Charging pile| The Ministry of Industry and Information Technology and other five departments jointly organized the 2024 new energy vehicles to the countryside activities. From May to December 2024, we will select new energy vehicle models suitable for the rural market, have a good reputation and reliable quality, and carry out activities such as centralized exhibitions, test rides and test drives, so as to enrich the consumer experience and provide diversified choices.
Comments: According to data from the China Association of Automobile Manufacturers, from July 2020 to 2022, the sales of new energy vehicles in the countryside in mainland China will increase from 397,000 to 2,659,800, driving the cumulative sales of new energy vehicles to the countryside to exceed 4.1 million in three years, which will promote the high demand for matching charging piles.
3. Real Estate According to the Housing and Urban-Rural Development Bureau of Lin'an District, Hangzhou, the People's Government of Lin'an District has decided to purchase a batch of commercial housing for public rental housing. The whole building is used as the basic acquisition unit, and the construction area of a single set does not exceed 70m, and the acquisition of the house needs to be matched with a certain proportion of parking spaces. A few days ago, Nanjing City also issued the "Nanjing City Planning and Construction of Affordable Housing Implementation Plan", in the way of preparation, can be appropriate to rebuild or purchase second-hand housing for affordable housing, revitalize the use of idle land and housing.
Comments: SDIC Securities Research Institute believes that the real estate industry policy expression of the Political Bureau of the Central Committee is more positive, and the work of ensuring the delivery of buildings is expected to continue in 2024, and improving the relationship between real estate supply and demand is also the focus of future policy promotion. The downward trend of the real estate industry can be expected to improve, helping the valuation of consumer building materials in the real estate chain to increase.
4. Unmanned driving According to a report by the Shanghai Securities Daily on May 15, Baidu Apollo held the Apollo Day2024 event in Wuhan and released the world's first large model ApoIIO ADFM that supports L4 autonomous driving, which can achieve more than 10 times the safety of human drivers and achieve city-level global complex scene coverage. Baidu Apolo also launched the sixth-generation unmanned car Yichi 06, and the first batch of 1,000 units will be delivered to Radish Run. As for Tesla's Robotaxi (shared taxi), Baidu said that it will consider possible cooperation opportunities based on Tesla's specific application model and the pace of entering the Chinese market.
Comments: Orient Securities Research Institute believes that domestic and foreign companies have increased Robotaxi and accelerated the commercialization of unmanned driving. Driven by domestic policy permits and the maturity of software and hardware technologies for high-end intelligent driving systems, the automotive industry in mainland China is expected to enter the L3 intelligent driving era in 2024. In the intelligent driving industry chain, pay attention to intelligent driving sensor electronic component manufacturers, chip suppliers and other links.
5. Lithium-sulfur battery According to the Chinese Academy of Sciences, the research team of the Institute of Metals of the Chinese Academy of Sciences and the scientific research team of the University of Technology Sydney recently released research results, focusing on the problems of organic sulfur cathode in thermodynamics, electrochemical reaction process, kinetics and practical prospects, decoding the electrochemical process of organic sulfur cathode and the law of charge and mass transport, establishing the connection between the electrochemical mechanism of the electrode and its practical parameters, and proposing the key parameters and implementation path of 500 Wh/kg lithium-sulfur battery, which will promote the practical process of lithium-sulfur battery.
Comments: The research team said that lithium-sulfur batteries are a very promising energy storage solution. Typically, lithium-sulfur batteries have 2 to 5 times the capacity of ordinary lithium-ion batteries. By using sulfur, the need for materials such as nickel, cobalt, etc. is reduced. Sulfur has many advantages such as abundant reserves, low cost, environmental protection and non-toxicity. With large capacity, low cost, long life and environmental protection, lithium-sulfur batteries will be an excellent alternative to traditional lithium-ion batteries.
6. Cruise| On May 15, the National Immigration Administration held a press conference, with the approval of the State Council, from May 15, 2024, foreign tour groups (2 or more) who come to China by cruise ship and are received by domestic travel agencies can enter the country without a visa and stay for no more than 15 days from the cruise ports of 13 cities, including Tianjin, Dalian, Liaoning, Shanghai, Lianyungang in Jiangsu, Wenzhou and Zhoushan in Zhejiang, Xiamen in Fujian, Qingdao in Shandong, Guangzhou and Shenzhen in Guangdong, Beihai in Guangzhou, Haikou and Sanya in Hainan.
Comments: According to the analysis, the cruise economy is known as the "water gold industry". Since 2006, China's cruise industry has opened the home port market and achieved rapid development. Experts said that the recovery of the cruise economy has accelerated, mainly due to policy support, rapid market recovery, growth in cultural and tourism consumption, and improvement in the global inbound and outbound tourism market. The growth of the cruise market is expected to help improve the travel experience of consumers, and will also bring new business opportunities to various industries such as manufacturing and services. China's cruise economy will enter the second golden decade of development.
Today's news preview
JD.com, Baidu, iQiyi, and Walmart announced their financial reports.
Philadelphia Fed President, Cleveland Fed President, Atlanta Fed President speak.
U.S. Housing Starts and Building Permits for April.
U.S. industrial production in April.
The number of initial jobless claims in the United States last week.
Japan's real GDP in the first quarter.
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